SHOPPERS may soon be able to pick up Premium Bonds at the check-out as Ernie plans a major shake-up in the way they are sold.

Customers could even be able to buy them at their local petrol station or cinema as National Savings & Investments (NS&I) goes in search of new partners to widen the market for Premium Bonds which currently attract investments of é12.7bn a year.

Today NS&I introduced a new scheme allowing people to set up standing orders for Premium Bond purchases from é50 up to the maximum holding of é30,000.

Earlier his month, NS&I, led by chief executive Alan Cook, raised the monthly prize pot by é4m to é65m - enough to double the number of é100 winners to 160,000, add an extra é100,000 prizewinner to make a total of five, and add another é25,000 winner for a total 18. Four more é10,000 prizes take the total in that category to 18.

It isn't all good news, however. Recent years have seen an influx of investors, driven by falling share prices, low savings rates and low inflation. In the last five years the odds against winning the é1m prize doubled - from one in 13bn to one in 25bn.

é5,000 prize

Over the same period the odds against winning a é5,000 prize have gone from one in 127m to one in 261m. Even on é50 consolation prizes, the chances are one in nearly 30,000 - against 25,000 in 1999.

NS&I say the chances of a prize on any single Bond have halved - from 11,500 to one in 1957, when Bonds were launched, to around 24,000 to one today. Since 1970, odds have fluctuated mostly in the bracket of 20,000-28,000 to one.

Independent financial adviser Mike Nicholson, of Premier Financial Planning in Cheadle Hulme, said: "The attractions of Premium Bonds are not what they once were. If you are a lucky person and you fancy a flutter, by all means have a go. At least you'll get your stake money back

"But for most people a cash ISA is currently a better option, particularly now that they are giving tax-free rates of five per cent upwards. They would be better off putting their money where it will earn a guaranteed benefit."